REG - Marshalls PLC - Trading Statement

MarshallsAnnouncement

19/01/2023 07:00

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RNS Number : 1819N  Marshalls PLC  19 January 2023

Marshalls plc

('Marshalls' or 'Group')

 

Full Year Trading Update

Notice of results

 

Group revenue for the year ended 31 December 2022 was £719 million (2021:
£589 million), which represents year-on-year growth of 22 per cent including
the benefit of the acquisition of Marley. On a like-for-like basis, Group
revenue growth was one per cent. The Group's performance in the period since
the trading update on 7 October 2022 has been as anticipated and the Board
expects to deliver adjusted profit before tax for the full year that is
in-line with current market expectations(1).

 

Trading performance

 

Marshalls Landscape Products experienced tough market conditions due to its
exposure to the more discretionary elements of private housing RMI, delivering
revenue of £394 million (2021: £425 million), which represents a reduction
of seven per cent compared with the prior year.  The rate of contraction in
the fourth quarter moderated to 12 per cent compared to 16 per cent in the
third quarter reflecting a more stable inventory profile in the distribution
channel. The decisive actions taken to reduce production capacity and the cost
base, were concluded in November, the effect of which was to reduce annual
operating costs by approximately £10 million.

 

Marshalls Building Products traded robustly in 2022, despite experiencing some
slowing of activity in the final quarter of the year with poor weather
disrupting construction sites in December.  Revenue grew by 17 per cent to
£193 million (2021: £164 million) with a particularly strong performance
from the Bricks and Masonry business.

 

Marley Roofing Products delivered revenue of £132 million in the eight months
of ownership, which represents growth of six per cent compared to the
corresponding period in 2021. The rate of revenue growth moderated during the
second half of the year due to a softer market backdrop and destocking in the
distribution channel, with revenue in the final quarter being in-line with
2021. The integration of Marley into the Group continues to progress in-line
with plan, and the Board remain confident of extracting value from operational
improvements and leveraging best practices within the Group.

 

Balance sheet and liquidity

 

The Group's balance sheet continues to be robust, with good progress made to
reduce leverage.  Pre-IFRS16 net debt ended the year at £191 million,
reflecting strong working capital management. The Group maintained good
headroom against its bank facility and covenants which, when combined with the
strong cash generative nature of the Group, enables continued focus on the
Board's capital allocation priorities, whilst reducing leverage.

 

Outlook and notice of results

 

Whilst mindful of the uncertain macro-economic environment and its impact on
the sector, the Board remains confident of making continued progress towards
Marshalls' ambition to become the UK's leading manufacturer of products for
the built environment.  The Group remains well placed to achieve this goal,
supported by its diversified products and end markets, strong market
positions, established brands and focused investment plans to drive further
operational improvements.

 

The Group will announce its results for the year ended 31 December 2022 on 15
March 2023, at which time it will provide further guidance on the year ahead.

 

(1) Company compiled market consensus for 2022 adjusted profit before taxation
is £90.4 million with a range of £89.8 million to £91.1 million.

 

Enquiries:

 

 Martyn Coffey     Chief Executive           Marshalls plc       +44 (0)1422 314777

 Justin Lockwood   Chief Financial Officer

 Tim Rowntree                                MHP Communications  +44 (0)20 3128 8540
 Charlie Barker                                                  +44 (0)20 3128 8147

 

Note to the Editor:

 

About Marshalls plc:

 

Established in the late 1880s, Marshalls plc is a leading UK manufacturer of
products for the built environment.  It operates through three trading
divisions: Marshalls Landscape Products; Marshalls Building Products; and
Marley Roofing Products.  Marshalls Landscape Products is the UK's leading
manufacturer of superior natural stone and innovative concrete hard
landscaping products, supplying the construction, home improvement and
landscape markets.  Marshalls Building Products is a supplier of concrete
drainage products, concrete bricks, ready-to-use mortars and aggregates.
Marley Roofing Products is a leader in the manufacture and supply of pitched
roofing systems, including clay and concrete tiles, timber battens, roof
integrated solar solutions and roofing accessories.

 

The Group operates its own quarries and manufacturing sites throughout the UK,
including a national network of manufacturing and distribution sites, and has
operations in Belgium and sales representation in other international markets.
Marshalls is committed to quality in everything it does, including the
achievement of high environmental and ethical standards and continual
improvement in health and safety performance.

 

Forward-Looking Statements:

 

Any statements in this release, to the extent that they are forward-looking,
are subject to risk factors associated with, amongst other things, the
economic and business circumstances occurring from time to time in the markets
in which Marshalls operates. It is believed that the expectations reflected in
these statements are reasonable, but they may be affected by a wide range of
variables which could cause actual results to differ materially from those
currently anticipated.  More information about the factors that may affect
Marshalls' performance is contained in the Annual Report to shareholders for
the year ended 31 December 2021.

 

 

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